Using a mortgage broker costs you nothing - except maybe a phone call. As a member of Vow Financial Group I have access to over 25 lenders. I have over 15 years experience as a mortgage broker and hold Dip Financial Services. With current rates as low as 3.67% variable it is a great time to consider a refinance if your current lender hasn't been passing on the rate cuts.
As the squeeze continues on investor and interest only lending - owner occupied, principal & interest deals are getting more generous. Not just interest rates but higher LVR and more flexibility for example smaller apartments.
A recent article I posted on LinkedIn - This issue pops up every few years - the big banks want more market share and so suck up to mortgage brokers but eventually they just can't keep their hands off our trail commission and start trying to refinance existing loans through their branches. It's called 'channel conflict' and undermines our relationship with our clients. In the worst case the lender tries to re-originate your loan within the first twelve months using promises... of lower rates or fees - which in reality are probably the same rates they are offering on that day to borrowers off the street. If we were to do that it would be called churning and ASIC takes a dim view of churning. However when the bank does it they then have the 'self appointed right' to clawback the commission that they paid us in the first place. So we introduce the customer to them, we do all the preliminary work and submit the application, monitor the progress through to settlement and all for nothing - we don't make cent.
So regulators allow this very profitable outcome for the banks to churn customers because it results in a better deal for the client. However the outcome for the broker is entirely unfair since the bank initiates the churn they should not have the right to clawback the commission paid for the original work completed.
When it comes to commission brokers can't deal directly with the lenders, we are forced to work through aggregation groups who fundamentally are a very profitable clearing house for payments. The process of payments and clawbacks are agreed between the aggregators and the lenders - a clawback is deducted from the brokers monthly payment without notice. Since the GFC lenders have taken significant financial interests in most of the larger aggregation groups ...can you see a problem here?
Over the past 10 years there has been interminable stream of regulation intended to make better outcomes for borrowers. However if lenders are allowed to abuse their position to the detriment of brokers then that will result in a loss of competition and ultimately a poorer outcome for borrowers. It is probably time that the ACCC took a closer look at these arrangements and the mortgage market as a whole. Where are the MFAA and the FBAA on this issue?
Business finance through the banks can be a nightmare and not cheap. We now have access to unsecured short term business finance designed to keep your business wheels turning through the peaks and troughs ....https://keychange.com.au/mo…/unsecured-business-finance.html
Once again this year I am entering the Scrapheap Adventure to raise funds for Down Syndrome Australia. So far over my last two events I have raised almost $13,000 and this year I hope to break more records. If you can afford to donate please do - if you can't then please share .
The bubble that is causing the regulators to constrain lending only exists in Sydney & Melbourne and yet the entire country is impacted by the tightened lending policy....I mean some areas could do with some stimulation rather than constraint.
Just completed accreditation with Australian Military Bank and so now have access to DHOAS and a range of standard mortgage products. So if you are in the military and thinking of a home loan give me yell.
Just this week CBA again confirmed that I have to conduct face to face in person interviews and yet their products are offered by several completely virtual operators such as Lendi. Meanwhile NAB have the same face to face policy and yet operate uBank which is a completely virtual service. Double standards and inconsistency abound. Luckily there are tar better deals than CBA or NAB are offering.
Lots of Aussie expats are struggling to find finance or refinance options. Commonwealth Bank have a policy that still allows expats to borrow however there is a catch - they insist that either the broker must interview them in person (skype not acceptable) or they have to attend an Australian branch. If I planned it right I could cover the cost of the return air fare to London via Qatar and sign up maybe half a dozen loans ...but really.